Chipotle Mexican comparable sales rise in December

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[January 10, 2017]  (Reuters) - Chipotle Mexican Grill Inc <CMG.N> said comparable sales rose 14.7 percent in December compared with a 30 percent decline a year earlier, suggesting the worst may be over for the burrito chain as it recovers from food safety lapses in 2015.

A Chipotle Mexican Grill is seen in Los Angeles, California, U.S. on April 25, 2016. REUTERS/Lucy Nicholson/File Photo

Chipotle's shares rose 4.5 percent to $413 in premarket trading on Tuesday.

Sales at established restaurants, however, likely fell 4.8 percent in the fourth quarter ended December - the fifth straight quarterly decline.

Chipotle said in October it expected established restaurant sales to fall in the low single-digits percentages in the fourth quarter but grow in high-single digits in 2017.

The company also announced plans on Tuesday to buy back shares worth $100 million. (http://bit.ly/2iXQnRo)

Chipotle said it incurred higher-than-expected expenses due to increased promotional spending and costs related to television advertising.

The company estimated a profit of 50-58 cents per share for the quarter, widely missing the average analyst estimate of 96 cents.

Food costs were also higher than anticipated due to increased costs of avocados, a key ingredient in guacamole.

The company estimated sales of $1.04 billion, below the average analyst estimate of $1.05 billion, according to Thomson Reuters I/B/E/S.

Chipotle's shares were up 0.5 percent after falling 3.2 percent in premarket trading on Tuesday.

(Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Saumyadeb Chakrabarty)

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